From left: Mike Verveer and Sabrina Madison.
Madison is starting its budget process unusually early this year, says longtime Ald. Mike Verveer, left, to address a projected $27 million shortfall. Ald. Sabrina Madison, right, says the 'least regressive' solution is a referendum for a property tax hike in November.
Madison alders are not happy with the options they have to close an estimated $27 million budget shortfall, including a series of prospective cuts to agencies laid out in a bleak city report.
“Frankly it was shocking for me to read through that last night,” east-side Ald. Derek Field said at a special Committee of the Whole meeting of the city council Tuesday night. “Those were some very, very large cuts to libraries, police, fire, streets and many others.”
To tackle the shortfall, alders are getting their earliest start on budget deliberations in decades, according to Ald. Mike Verveer, who has represented downtown Madison for nearly 30 years. “This is literally six months earlier than I have ever been asked to start the budget process. That’s pretty eye opening,” he said at the meeting.
In addition to agency cuts, the city is also considering a ballot referendum in November to raise property taxes beyond what is allowed by state law.
“The menu of options is extremely limited under state law,” Dave Schmiedicke, city finance director, told the alders.
State law also prevents Madison from implementing a local sales tax or taxes on such items as soda, gas and tobacco. The city’s funding gap is due to years of declining state aid, expiring federal aid, including COVID funds, and high inflation.
Several alders said avoiding cuts to city staff already stretched thin was a priority as they worked out a way forward.
“My biggest concern at the moment are the staff that work so hard for our city that have been overlooked for many years,” said east-side Ald. Dina Nina Martinez-Rutherford.
“Coming into this meeting, I was leaning toward a mixed approach,” added west-side Ald. John Duncan, referring to a combination of a referendum, hikes to city fees, and service or staff cuts. “But listening to my colleagues tonight, I’m seeing what that approach would actually do…I am now leaning toward a full $27 million referendum.”
Several alders said cuts would also impact the nonprofits the city funds. “We don’t have answers for the folks we already are getting calls from” who need help with housing or food, said Ald. Sabrina Madison, who is the director of the Progress Center for Black Women. “We’re already stressed by not having places to refer them,” she added. “I do think the least regressive way is to go to referendum for the full amount [of the shortfall].”
“I don’t want to balance our budget on the backs of our nonprofits,” said Ald. Tag Evers, who represents near-west Madison and the south side. “For the average property owner we’re talking about less than $1 per day that we would be asking residents to vote for in order to maintain these high-quality services.”
Some alders were looking to avoid a referendum or propose one that asked for less money or was paired with cuts and fee hikes. “I’m really struggling with the referendum,” said north-side Ald. Charles Myadze, who said he was “torn” because he also didn’t want any cuts to city staff.
Other alders suggested the possibility of a new transportation fee and preparing a “plan B” of cuts and fees to balance the budget in case a referendum fails in November. In 2022, property tax referenda in the neighboring communities of Middleton and Shorewood Hills were successful.
Verveer said the city could consider fee increases and a “soft hiring freeze” — restricted hiring with some exceptions — to take some of the pressure off of a referendum. He said he was worried apartment building owners would wage a campaign against a property tax referendum, telling tenants their rents would increase as a result.
In the longer term, some alders wanted to offer transportation, EMS, and other city services to surrounding suburbs in order to boost revenue, and pursue changes to the state’s shared revenue formula if the composition of the state Legislature changes in future years.
Dan Rolfs, a 21-year city employee who works as a real estate development manager, summed up the city’s predicament ahead of the discussion. “The system is rigged against us. It’s a setup to strangle local government,” he said, referring to the state’s property tax limits. Rolfs said he supported a referendum to cover the full shortfall so that city services and staff wouldn’t be pitted against each other to make cuts.
Rolfs, who also serves as the board president of the union representing the city’s white collar workers and certain managers, said staff have continually been asked to “do more with less” for years, and even decades.
Martinez-Rutherford noted that city workers have already been stretched thin and staff hasn’t kept up with Madison’s growth in recent years. “We are no longer a small town, we are a city,” she said. “This is a different ball game.”
